Research On The Influence Of The Listed Companies’ Small And Medium-sized Investors Protection Level On Corporate Value

In recent years, because the correlative laws and regulations are not perfect, the efficiency of the government supervise of the market is insufficient, the governance structure of many companies are not perfect and many other factors, corporations tend to be found more and more unconvincing. Big shareholders hollow out company’s assets and financial staff make financial frauds. It leads the small and medium-sized investors to lose their interests. So the issue of small and medium-sized investors protection has became a hot topic in the field of theory and practice. The protection of the interests of small and medium-sized investors is a important issue, which affect the operation of enterprises and the development of capital market. In order to give advice to the operation of enterprises and the development of capital market, this paper focuses on how the protection level of small and medium-sized investors influence corporate value.This paper defines the concept of the protection of the small and medium-sized investors and corporate value firstly. Then decides to measure corporate value by Tobin’s Q and constructs the index system of the protection level of small and medium-sized investors in corporate terms. We decide to measure the level of the protection of small and medium-sized investor by governance structure, dividend payment and information disclosure. The specific variables contain the proportion of the big shareholders hold, the equity balance degree, the proportion of the independent directors, cash dividends and audit opinion. Based on the related theories, we chose the method of combination of cash flows to divide the life cycle of enterprise. And then divide the A-share listed companies of Shanghai and Shenzhen stock markets into615enterprises in the growth stage and102enterprises in the mature stage. We combine normative analysis with empirical analysis to analyse the present situation and influence of the protection level of small and medium-sized investor and corporate value. Then combine the studies made by former scholars with the present situation and put forward the hypothesis, establish the linear regression model. This paper selects the2010-2012data from listed companies in China for the study sample. For615enterprises in the growth stage, we obtain1845data. For102enterprises in the mature stage, we obtain306data. We finally use the level of the protection of small and medium-sized investors as explanatory variable, use Tobin’s Q as explained variable. And use the growth rate of main business income, asset-liability ratio, enterprise scale and year as control variables in order to make empirical study. The results of the empirical study show that there is a positive correlation between the level of the protection of small and medium-sized investors and corporate value whether for enterprises in the growth stage or enterprises in the mature stage. And the positive correlation is more obvious in enterprises in the growth stage. Finally, according to the results of the empirical analysis, we give advice to how to improve the protection level of small and medium-sized investors, and then increase corporate value, and bring about the healthy development of the security market of our country.